1999 (9) TMI 897 - AT - Central Excise

Summary

Issues involved: Alleged duty evasion on unspecified quantity of biris, insufficient evidence of clandestine manufacture and clearance, reliance on seized register entries, contention on limitation.

Summary:

Alleged Duty Evasion:
The Collector held the appellant accountable for evading duty on biris and imposed a penalty. The appellant's advocate argued that the evidence relied upon, a register seized from the appellant's brother-in-law, did not conclusively prove clandestine manufacture and clearance of biris. The register mainly contained details of kendu leaves and tobacco sales, with insufficient evidence linking the appellant to biri manufacturing. Some individuals initially named as rollers denied involvement, leading the Collector to discount their testimony. The appellant emphasized the lack of substantial evidence and raised concerns about the limitation.

Insufficient Evidence:
The departmental representative contended that the register entries indicated biri manufacturing and clearance by the appellant. However, the Tribunal noted that the register entries were inconclusive, with most not mentioning biris specifically. Despite suspicions about the accounts, the Tribunal found it insufficient to establish the appellant's involvement in biri production, especially in the quantities alleged. The Tribunal emphasized the need for sufficient evidence to prove clandestine removal of excisable goods, citing legal precedent.

Decision:
After thorough consideration, the Tribunal allowed the appeal, setting aside the impugned order. The Tribunal concluded that the evidence presented, primarily the seized register entries, was insufficient to prove the appellant's involvement in manufacturing and clearing biris. Due to the lack of concrete evidence, the benefit of the doubt was given to the appellant. The Tribunal did not delve into the limitation arguments given the primary issue of insufficient evidence.

This judgment by the Appellate Tribunal CEGAT, Mumbai, highlights the importance of substantial evidence in cases of alleged duty evasion and clandestine activities, emphasizing the need for a thorough investigation to establish liability conclusively.